WEBVTT Kind: captions; Language: en 00:00:21.001 --> 00:00:25.000 What company is number one in the world and after-tax profits? 00:00:25.000 --> 00:00:30.001 What company had gross sales last year of $46 billion, bigger than the 00:00:30.001 --> 00:00:32.000 entire budget of the state of California? 00:00:33.000 --> 00:00:35.001 What computer is a businessman most likely to buy? 00:00:36.000 --> 00:00:38.001 The answer to all of the above? IBM. 00:00:39.001 --> 00:00:43.001 Today, an in-depth look at IBM, from the PC Junior to the high-performance AT. 00:00:44.000 --> 00:00:47.001 All coming up next on this edition of the Computer Chronicles. 00:01:08.001 --> 00:01:14.000 The Computer Chronicles is brought to you in part by McGraw-Hill, publishers of 00:01:14.000 --> 00:01:18.001 popular computing, the magazine that gives readers an understanding of the 00:01:18.001 --> 00:01:23.000 technology and applications of microcomputers and software in 00:01:23.000 --> 00:01:25.000 office, home and classroom. 00:01:32.000 --> 00:01:36.000 Welcome to the Computer Chronicles. I'm Stuart Chafay and this is Gary Kildall. 00:01:36.001 --> 00:01:40.001 And Gary, our subject today is IBM and the dominant role they play in the 00:01:40.001 --> 00:01:42.001 computer world in general and the PC world in particular. 00:01:43.000 --> 00:01:45.001 Matter of fact, they've taken over the phrase PC. It doesn't mean personal 00:01:45.001 --> 00:01:48.000 computer anymore. It means an IBM personal computer. 00:01:48.001 --> 00:01:52.000 Is this kind of domination by one company good or bad for the 00:01:52.000 --> 00:01:53.001 industry and good or bad for the customer? 00:01:53.001 --> 00:01:57.000 Well, IBM came into our industry when we were struggling with hardware standards. 00:01:57.001 --> 00:01:59.001 They set standards and they put a lot of companies out of business. 00:02:00.000 --> 00:02:03.000 Their influence and their control over our industry is really awesome. 00:02:03.001 --> 00:02:06.000 And we've got to really sharpen our pencils to make sure we have competitive 00:02:06.000 --> 00:02:09.000 products and maintain a position where we can deal 00:02:09.000 --> 00:02:11.000 with the large influence they have. 00:02:11.001 --> 00:02:14.000 Okay, on today's program we're going to meet several IBM 00:02:14.000 --> 00:02:15.001 analysts, both fans and critics. 00:02:16.000 --> 00:02:19.001 We'll take a look at Top View, IBM's new multitasking multi-window user 00:02:19.001 --> 00:02:22.000 interface, and in general try to break through the mystique 00:02:22.000 --> 00:02:23.001 of the world's largest computer company. 00:02:24.000 --> 00:02:28.000 Now, how did IBM get to where it is today? We're going to begin with a look at 00:02:28.000 --> 00:02:29.001 the birth and the growth of Big Blue. 00:02:31.001 --> 00:02:36.000 This early IBM promotional film may share the dated style of the other films of 00:02:36.000 --> 00:02:38.001 the 50s, but it represents something more. 00:02:39.000 --> 00:02:41.001 The particular outlook of a company that grew to become the 00:02:41.001 --> 00:02:43.000 world's largest and wealthiest. 00:02:44.000 --> 00:02:47.001 In many respects, the history of IBM is the history of computing. 00:02:47.001 --> 00:02:51.001 The parent company's founder, Herman Hollerith, devised the first 00:02:51.001 --> 00:02:53.001 practical card punch calculator. 00:02:54.000 --> 00:02:58.000 It was used for the first time to tabulate the 1890 American Census. 00:02:59.000 --> 00:03:02.001 The IBM card soon became the symbol of the early computer age. 00:03:03.001 --> 00:03:08.000 IBM's first mainframe, the Mark I, ushered in the post-war era of data 00:03:08.000 --> 00:03:11.001 processing, for the most part restricted to scientific applications. 00:03:12.000 --> 00:03:16.001 But IBM's choice market was always business, especially big business. 00:03:16.001 --> 00:03:21.000 As advances in memory and storage took place, they were applied 00:03:21.000 --> 00:03:22.001 and promoted for business use. 00:03:23.001 --> 00:03:27.001 In this manner, the company developed an almost exclusive hold on the data 00:03:27.001 --> 00:03:30.000 processing departments of major corporations. 00:03:30.001 --> 00:03:35.000 By the 1960s, IBM was the leader both technically and commercially with over 00:03:35.000 --> 00:03:37.000 two-thirds of the mainframe market. 00:03:37.001 --> 00:03:42.001 Its pervasive customer support and computer families gave it a major advantage in 00:03:42.001 --> 00:03:44.001 almost every aspect of business computing. 00:03:44.001 --> 00:03:49.000 By 1966, the company began to look at the small business market 00:03:49.000 --> 00:03:51.000 and expand it overseas. 00:03:52.001 --> 00:03:57.001 Today, suddenly cleared of its history-making antitrust suit, IBM continues to 00:03:57.001 --> 00:04:01.001 expand its share of the market, and it does so in the same way it has in the 00:04:01.001 --> 00:04:05.001 past, secretively, cautiously, and with ruthless efficiency. 00:04:19.000 --> 00:04:23.000 Joining us now is Tom Rolander. Tom was formerly with Intel and Digital Research. 00:04:23.001 --> 00:04:26.000 Tom designed some of the earliest multitasking systems, such as 00:04:26.000 --> 00:04:28.000 RMX, Starplex, and Concurrent. 00:04:28.001 --> 00:04:30.001 Tom is now vice president for engineering with ActiveVenture. 00:04:31.000 --> 00:04:34.001 And next to Tom is Norm DeWitt. Norm is a 16-year veteran of IBM. 00:04:35.000 --> 00:04:38.001 Currently, he's the group director of the PC Industry Service at DataQuest 00:04:38.001 --> 00:04:40.000 in San Jose. Gary? 00:04:40.001 --> 00:04:44.001 Norm, IBM saw some opportunities here a few years ago and jumped right in and 00:04:44.001 --> 00:04:46.000 took the lion's share of the PC market. 00:04:46.001 --> 00:04:49.001 Do you see any effective competition now, or are we all going to be working 00:04:49.001 --> 00:04:52.000 toward being compatible with IBM? 00:04:53.000 --> 00:04:58.000 Well, Gary, in 1984, we saw IBM capture 26 percent of the worldwide PC market, 00:04:58.000 --> 00:05:02.000 and we at DataQuest expect that that market share will continue to increase 00:05:02.000 --> 00:05:04.001 through our forecast period, which ends in 1989. 00:05:04.001 --> 00:05:07.001 I would certainly expect that they would command 40 to 50 00:05:07.001 --> 00:05:09.001 percent of the market by that point in time. 00:05:10.000 --> 00:05:13.000 But there are opportunities for other competitors in the market. 00:05:13.000 --> 00:05:17.000 In fact, there is strong competition today from Apple, from Compaq, from 00:05:17.000 --> 00:05:19.000 several of the Japanese manufacturers. 00:05:19.001 --> 00:05:24.000 And we certainly expect to see AT&T make the move within the next two years. 00:05:24.000 --> 00:05:26.001 If you watch the ads on television, I guess there's a definite 00:05:26.001 --> 00:05:28.000 tendency in that direction. 00:05:28.001 --> 00:05:30.000 Now, what is AT&T going to do? 00:05:30.000 --> 00:05:36.001 Well, first of all, AT&T, as you are well aware, entered the market last June, 00:05:37.000 --> 00:05:39.001 and in the last six months has really had to 00:05:39.001 --> 00:05:41.000 establish their channels of distribution. 00:05:41.001 --> 00:05:44.001 And I think they've done a good job. In the first six months, there were over 900 00:05:44.001 --> 00:05:48.000 retail dealers signed up to carry the AT&T product. 00:05:49.000 --> 00:05:54.001 But if their objective was to bring a PC-compatible machine to market only, a 00:05:54.001 --> 00:05:56.001 company like AT&T wouldn't bother. 00:05:57.000 --> 00:06:01.001 AT&T's real strength has to lie in their ability to bring communications 00:06:01.001 --> 00:06:03.001 to the PC marketplace. 00:06:03.001 --> 00:06:07.000 And we expect to see products from AT&T this year that 00:06:07.000 --> 00:06:08.001 take advantage of AT&T's stock market. 00:06:08.001 --> 00:06:13.001 So you think of the AT&T as being sort of a higher end of orientation, maybe the 00:06:13.001 --> 00:06:17.000 office environment, where communications is an important part of the... 00:06:17.000 --> 00:06:23.000 Definitely. If you look at our numbers on the total PC market, we see 68 percent 00:06:23.000 --> 00:06:26.000 of the market potential in the business office markets. 00:06:26.000 --> 00:06:27.000 So I think it's... 00:06:27.000 --> 00:06:30.001 IBM has introduced one machine here. It's the IBM PC 00:06:30.001 --> 00:06:32.000 -AT, which is definitely a high end machine. 00:06:32.001 --> 00:06:35.000 It's, in fact, a mini computer competitor in many cases. 00:06:35.001 --> 00:06:39.000 And they've also brought into the market the operating system called TopView, 00:06:39.001 --> 00:06:42.000 which is, again, a mini computer style attempt. 00:06:42.001 --> 00:06:45.001 Now, Tom, what is TopView? Can you show us what's going on here? 00:06:45.001 --> 00:06:48.001 Well, TopView is an operating environment that IBM has introduced. 00:06:49.000 --> 00:06:52.001 And I think they saw the need for providing a system which had multitasking, 00:06:52.001 --> 00:06:54.001 windowing, and data interchange capability. 00:06:54.001 --> 00:06:58.001 Because when machines moved to the generation of the XT and the 00:06:58.001 --> 00:07:00.000 AT, they had quite a bit of power. 00:07:00.001 --> 00:07:04.000 And a single threaded, single tasking operating system was not sufficient to be 00:07:04.000 --> 00:07:06.001 able to capitalize on the power of that particular machine. 00:07:06.001 --> 00:07:08.000 Can you show us how TopView works? 00:07:08.000 --> 00:07:10.001 Okay, this is a sign-on message for TopView. 00:07:11.000 --> 00:07:14.001 And when we execute TopView, what we see here is that we have the ability to 00:07:14.001 --> 00:07:16.000 select an application for execution. 00:07:16.000 --> 00:07:18.000 In this case, I might start by executing WordStar. 00:07:18.001 --> 00:07:21.001 So we show we can run a standard PC-DOS type of application. 00:07:21.001 --> 00:07:23.001 Now, at this point, we're running 00:07:23.001 --> 00:07:25.000 WordStar. It looks as if we're running under DOS. 00:07:25.001 --> 00:07:31.000 But if we want to, we can cycle back into the TopView menu, and from that menu, 00:07:31.000 --> 00:07:33.000 be able to select another program for execution. 00:07:33.001 --> 00:07:36.000 I'll select another program here, their DOS services program. 00:07:36.001 --> 00:07:39.000 Now, here's where it has a little bit of an impact on the ISVs. 00:07:39.001 --> 00:07:43.000 That is that, at this point, WordStar is what we call suspended. 00:07:43.001 --> 00:07:47.000 It's not able to execute because that program is not what's called a 00:07:47.000 --> 00:07:48.001 well-behaved application. 00:07:48.001 --> 00:07:52.001 Okay, so certain applications like WordStar might have to be modified to really 00:07:52.001 --> 00:07:54.001 take advantage of the TopView multitasking. 00:07:55.000 --> 00:07:56.000 That is correct. 00:07:56.001 --> 00:08:01.000 You see, the ISVs will be impacted in that if they have an application that goes 00:08:01.000 --> 00:08:05.001 direct to the video map, that program cannot run shared or in a background mode 00:08:05.001 --> 00:08:09.000 while something else is running because it would then go directly to the screen. 00:08:09.001 --> 00:08:13.000 So that version of WordStar must be modified so that it would 00:08:13.000 --> 00:08:14.001 go to a video display buffer. 00:08:14.001 --> 00:08:18.001 Okay, so you think there's going to be some, is there a time element involved, 00:08:18.001 --> 00:08:21.000 say, that before these applications will really start to... 00:08:21.000 --> 00:08:25.000 That's correct. I think we've seen a lot of interest from ISVs in pairing 00:08:25.000 --> 00:08:28.000 applications that are well-behaved so they can run in TopView. 00:08:28.000 --> 00:08:31.001 And in fact, applications that become TopView aware, that can take advantage of 00:08:31.001 --> 00:08:34.001 data interchange, copy, cut, and paste through a filter mechanism. 00:08:35.001 --> 00:08:38.000 The underlying TopView itself is a very powerful mechanism. 00:08:38.000 --> 00:08:41.001 I think that one thing that people get distracted with in TopView at times is 00:08:41.001 --> 00:08:45.000 that its user interface is often compared to the graphic style. 00:08:45.001 --> 00:08:47.001 This is a character-oriented window. 00:08:48.000 --> 00:08:52.001 Norm, how do you see that the Macintosh influence with graphics and so forth 00:08:52.001 --> 00:08:54.000 in the windows has been very well accepted? 00:08:54.001 --> 00:08:57.000 Is this going to be a detriment to TopView to not have that capability? 00:08:57.001 --> 00:09:01.001 I don't know that it'll be a detriment to TopView, but certainly the Macintosh 00:09:01.001 --> 00:09:06.000 environment, I think, is one that first-time users very quickly adapt to. 00:09:06.000 --> 00:09:10.000 And it's very possible that IBM could add 00:09:10.000 --> 00:09:11.001 graphics capability to this in the future. 00:09:12.001 --> 00:09:14.000 Is this sort of a safe step, maybe? 00:09:15.000 --> 00:09:20.000 I think this is a very strategic product from IBM that you'll see 00:09:20.000 --> 00:09:21.001 TopView around for many years to come. 00:09:22.000 --> 00:09:26.001 TopView has been controversial and some people are critical of it. What's the 00:09:26.001 --> 00:09:29.001 downside? What's the wrap-up on TopView besides the lack of graphics and icons? 00:09:31.000 --> 00:09:35.000 I think there's an impact on ISVs. You have to wait until applications, many of 00:09:35.000 --> 00:09:37.000 them, are modified to run in the TopView environment. 00:09:38.000 --> 00:09:41.001 And in fact, if you really want to take advantage of TopView 00:09:41.001 --> 00:09:43.001 capabilities, you have to become TopView-specific. 00:09:44.000 --> 00:09:47.001 Now, to an ISV, that means as soon as they write a TopView-specific application, 00:09:48.000 --> 00:09:52.001 their end user has to have an IBM PC and has to have purchased TopView 00:09:52.001 --> 00:09:54.000 before they can run that application. 00:09:54.001 --> 00:09:57.000 I think that's where the reluctance is coming from ISVs. 00:09:57.000 --> 00:10:02.000 It could also be that it looks like that TopView does take a lot of memory, and 00:10:02.000 --> 00:10:05.001 so that the actual computer system that you're working with is not just, say, a 00:10:05.001 --> 00:10:08.001 PC or a PCjr, but it's going to have to be a fully loaded AT. 00:10:09.000 --> 00:10:12.001 That's correct. It's really aimed at the high-capability machine. And I'm talking 00:10:12.001 --> 00:10:14.000 about half a megabyte with a hard disk. 00:10:14.000 --> 00:10:17.001 I don't think there'd be much point in running on a floppy-based system or with 00:10:17.001 --> 00:10:26.001 any less than half a megabyte. 00:10:26.001 --> 00:10:29.000 And we have to see that grow to some extent. It's a phenomenon that 00:10:29.000 --> 00:10:31.000 occurs, of course, in the whole industry over and over. 00:10:31.001 --> 00:10:36.000 Norm, you said this is an important strategic product for IBM. Are you suggesting 00:10:36.000 --> 00:10:38.000 you don't think the negatives are really that important 00:10:38.000 --> 00:10:40.000 and that this is a strong product? 00:10:40.001 --> 00:10:45.000 Well, I think when I say it's a strategic product, I think it's one that IBM is 00:10:45.000 --> 00:10:49.000 going to put its resources behind, both marketing and developmental. 00:10:50.000 --> 00:10:52.000 And I think you'll see the product evolve over time. 00:10:52.000 --> 00:10:56.001 If there are shortcomings at this point in time, IBM's been known to step 00:10:56.001 --> 00:10:58.000 up to product shortcomings in the past. 00:10:58.001 --> 00:10:59.001 Last year we saw an example of that. 00:10:59.001 --> 00:11:01.001 Does this also represent bringing software in-house? 00:11:02.001 --> 00:11:06.000 I think you'll see IBM offer more and more IBM 00:11:06.000 --> 00:11:08.000 -developed programs to the marketplace. 00:11:08.000 --> 00:11:11.000 So what effect does this have on the software vendors themselves? Are 00:11:11.000 --> 00:11:12.001 we going to get a lot of competition from IBM? 00:11:13.000 --> 00:11:17.001 Well, they will definitely have software competition from IBM. IBM has stated 00:11:17.001 --> 00:11:20.000 that they plan to capture a significant market share. 00:11:20.000 --> 00:11:22.001 Speaking of competition, we're going to take a look at a competitive 00:11:22.001 --> 00:11:24.000 product for Top View in just a moment. 00:11:24.001 --> 00:11:28.000 We'll also meet Stuart Alsop. He's publisher of a new newsletter called The 00:11:28.000 --> 00:11:31.000 Insider's Guide to the PC Industry. So stay with us. 00:11:44.000 --> 00:11:49.000 With us now is Stuart Alsop. Stuart was formerly the editor of InfoWorld. He now 00:11:49.000 --> 00:11:50.001 publishes the PC Letter. 00:11:50.001 --> 00:11:56.001 Stuart, we've all seen the dominance that IBM took in the hardware industry. At 00:11:56.001 --> 00:12:00.001 the time they were buying, let's say, the third-party software. 00:12:01.001 --> 00:12:05.000 Now they've also announced a recently old line of software products. Are we going 00:12:05.000 --> 00:12:07.001 to see the same kind of attempt to take over the software industry? 00:12:07.001 --> 00:12:10.000 Well, certainly they want to try to take over the software 00:12:10.000 --> 00:12:12.000 industry. That's part of their announced strategy. 00:12:12.000 --> 00:12:16.001 But recent reports indicate that the software isn't selling. And the real point 00:12:16.001 --> 00:12:20.000 with software is that that's what provides the value to the user. 00:12:21.000 --> 00:12:23.001 And unless it does provide value, the user won't buy it. 00:12:23.001 --> 00:12:27.000 What is the analysis of why it's not selling? 00:12:27.000 --> 00:12:33.000 The software that's been provided in the business productivity series, I believe 00:12:33.000 --> 00:12:38.001 they're called in the personal decision series, aren't competitive with what's 00:12:38.001 --> 00:12:41.000 currently being offered from Lotus Development and 00:12:41.000 --> 00:12:43.000 other application software companies. 00:12:43.000 --> 00:12:44.000 You mean it's just not as good, feature line? 00:12:44.001 --> 00:12:47.001 Just not as good. They're not as easy to use and not as powerful. 00:12:48.001 --> 00:12:52.001 Now, speaking of competitive products, Gary, your company, in fact, has a Top 00:12:52.001 --> 00:12:56.001 View-type multitasking system. Why don't you give me a brief introduction? 00:12:56.001 --> 00:13:01.000 We've been interested in the multitasking area for a long, long time. And Tom, in 00:13:01.000 --> 00:13:02.001 fact, did quite a bit of work in that area. 00:13:03.001 --> 00:13:07.000 And now that IBM has put the stamp of approval on multitasking, then, of course, 00:13:07.000 --> 00:13:08.001 we get a lot of interest in concurrent DOS. 00:13:09.000 --> 00:13:12.000 So, Tom, could you introduce it and see what's going on? 00:13:12.000 --> 00:13:16.001 Okay. The product I'll demonstrate here is called Concurrent PC DOS. It is a DOS 00:13:16.001 --> 00:13:19.001 -compatible operating system that provides the ability of running multiple 00:13:19.001 --> 00:13:21.000 concurrent DOS applications. 00:13:21.000 --> 00:13:26.000 On the screen right now, what I have is four separate windows, and we see 00:13:26.000 --> 00:13:27.001 three here outlined in different colors. 00:13:28.000 --> 00:13:30.000 The purpose for Windows is that it makes the user 00:13:30.000 --> 00:13:32.000 interface much easier to understand. 00:13:32.000 --> 00:13:34.001 We can see here that we have three distinct different applications. 00:13:35.000 --> 00:13:38.001 Here we see part of a directory in one screen. By hitting a single keystroke, I 00:13:38.001 --> 00:13:42.001 can move to a second screen, a third screen, and finally, down to 00:13:42.001 --> 00:13:44.000 a screen in which I have loaded WordStar. 00:13:44.001 --> 00:13:47.001 So here we have WordStar executing, and we could be running that 00:13:47.001 --> 00:13:49.000 concurrently with other applications. 00:13:49.000 --> 00:13:53.001 And we can cycle through the window manager to see those other applications. 00:13:53.001 --> 00:13:57.000 So these are like four different computer systems that are in the same place? 00:13:57.001 --> 00:14:00.001 That's correct. So while that screen is still scrolling, I can move to another 00:14:00.001 --> 00:14:04.001 screen, do another operation, another directory or something, perhaps, and 00:14:04.001 --> 00:14:08.000 finally, moving to another screen and here, perform yet, another operation. 00:14:08.001 --> 00:14:14.000 I think the important issue is that both top view and concurrent DOS are really 00:14:14.000 --> 00:14:17.001 headed toward another level of small computer users. 00:14:18.001 --> 00:14:22.000 They're both capable of supporting communications, say, in the background. 00:14:22.000 --> 00:14:24.000 They're capable of supporting network kinds of facilities. 00:14:24.001 --> 00:14:27.001 And as we see that move into the office, those applications 00:14:27.001 --> 00:14:29.000 are going to just expand and expand. 00:14:29.001 --> 00:14:33.001 Stuart, looking at this kind of multitasking user interface from the consumer or 00:14:33.001 --> 00:14:36.001 customer's point of view here, what do you get and what do you give up for this? 00:14:36.001 --> 00:14:43.000 Well, the problem with both top view and I'm not sure entirely of 00:14:43.000 --> 00:14:47.000 PC DOS but of other operating environments that integrate different applications 00:14:47.000 --> 00:14:51.001 is that they require a lot of effort in the part of the user in order to share 00:14:51.001 --> 00:14:55.001 applications and also just financially in terms of the amount of money you have 00:14:55.001 --> 00:14:58.001 to spend on the program itself and on upgrading your machine 00:14:58.001 --> 00:15:00.000 in order to run them. 00:15:00.000 --> 00:15:05.001 And there's no specific value from the program itself. It nearly integrates 00:15:05.001 --> 00:15:07.001 programs. It doesn't provide you with a function. 00:15:08.000 --> 00:15:10.001 And the problem is persuading that there's real value. 00:15:11.000 --> 00:15:14.000 I think the real, it comes back again, though, the real value or applications 00:15:14.000 --> 00:15:18.001 like, again, I'm not talking about top view or concurrent DOS specifically, but 00:15:18.001 --> 00:15:20.000 when you get into multitasking, you're talking 00:15:20.000 --> 00:15:21.001 about capabilities of many computers. 00:15:21.001 --> 00:15:25.000 And that's what, you know, fundamentally, why do people still use many computers 00:15:25.000 --> 00:15:28.001 if there isn't something that's an advantage there and the advantage in most 00:15:28.001 --> 00:15:31.001 cases is multitasking and being able to get at bigger file systems. 00:15:32.000 --> 00:15:35.001 And that's what we're seeing with things like the PCAT is really a whole 00:15:35.001 --> 00:15:40.000 different generation of many computer competitive type of systems. 00:15:40.001 --> 00:15:44.000 In fact, I think what I've called it is the first many 00:15:44.000 --> 00:15:46.000 computer disguised as a personal computer. 00:15:47.001 --> 00:15:52.000 Now, we have talked about IBM and its strength in the hardware side of the 00:15:52.000 --> 00:15:54.001 business. We've talked about it in the software side of the business. 00:15:55.000 --> 00:15:58.000 Now, the interesting thing about IBM is not only tough on its competitors, it can 00:15:58.000 --> 00:16:01.001 be very tough on its friends in terms of its sheer volume and ability to make or 00:16:01.001 --> 00:16:05.001 break a company it works with as a supplier. We have a report on that. 00:16:08.001 --> 00:16:13.000 Many IBM suppliers have signed agreements not to discuss their 00:16:13.000 --> 00:16:14.001 business relationship with IBM. 00:16:15.001 --> 00:16:20.000 We've asked Bill Godbout, a veteran of the microcomputer industry and former IBM 00:16:20.000 --> 00:16:23.001 employee, to discuss the relationship of IBM and its suppliers. 00:16:23.001 --> 00:16:30.000 In a number of cases where IBM suppliers have gotten into trouble, IBM is sitting 00:16:30.000 --> 00:16:35.001 on some very healthy cash reserves and they have advanced monies in the form of 00:16:35.001 --> 00:16:42.001 loans or prepayments and whatnot to try to ensure the viability 00:16:42.001 --> 00:16:44.000 of their suppliers. 00:16:45.000 --> 00:16:52.000 Human nature being what it is, there's a mixture of avarice and a mixture 00:16:52.000 --> 00:16:56.001 of laziness. I mean, it's real easy when one customer walks in and says, we'll 00:16:56.001 --> 00:16:59.001 buy everything you make for the next three years to just sit 00:16:59.001 --> 00:17:01.000 back and say, we've got it made. 00:17:01.000 --> 00:17:07.001 And why do anything else? Why not just sit back and you've got visions of 00:17:07.001 --> 00:17:12.001 sugarplums, the money's going to be rolling in. Well, if that customer finds your 00:17:12.001 --> 00:17:18.001 product is unsuitable for any reason, and it may be a fine product, but it's no 00:17:18.001 --> 00:17:23.001 longer suitable for their design, they need to be able to have the flexibility to 00:17:23.001 --> 00:17:26.000 change the design and design your product out. 00:17:26.000 --> 00:17:31.001 The decision to compete against IBM or become one of IBM suppliers will always 00:17:31.001 --> 00:17:36.001 carry its risks, but it's a safe bet that as far as IBM is concerned, business is 00:17:36.001 --> 00:17:39.001 business. This is Robin Garthwaite for Computer Chronicles. 00:17:41.000 --> 00:17:44.000 I can't help but be reminded about that joke. How do you dance with 00:17:44.000 --> 00:17:45.001 an elephant? Very carefully. 00:17:47.000 --> 00:17:51.001 Gary, I'd like to introduce John Doar who has joined us now. John is a general 00:17:51.001 --> 00:17:54.001 partner at Kleiner Perkins Caulfield & Byers, one of the major venture 00:17:54.001 --> 00:17:56.000 capital firms in the PC industry. 00:17:56.001 --> 00:17:59.000 And they've helped start a couple of small companies like Lotus Compact 00:17:59.000 --> 00:18:04.000 Businessland among others. John, one of the common lines about the IBM dominance 00:18:04.000 --> 00:18:08.000 in this field is that it has made it more difficult in the venture capital arena 00:18:08.000 --> 00:18:10.000 for startups. Is that in fact true? 00:18:10.000 --> 00:18:13.000 That's definitely true. While IBM has created enormous opportunities for 00:18:13.000 --> 00:18:16.001 companies such as Lotus Compact and Businessland, there's been a definite 00:18:16.001 --> 00:18:19.000 chilling effect on the startup of new ventures. 00:18:20.000 --> 00:18:24.000 What does that do to innovation? We were talking about dominance of IBM in this 00:18:24.000 --> 00:18:26.001 industry. Don't we need startups to have innovation 00:18:26.001 --> 00:18:28.000 in new directions in computing? 00:18:28.000 --> 00:18:33.000 Well, it's possible to innovate within the so-called IBM or I prefer to say 00:18:33.000 --> 00:18:36.000 industry standard. There's plenty of examples of that. Software companies that 00:18:36.000 --> 00:18:40.000 have integrated, innovated, hardware companies that have added take back up or 00:18:40.000 --> 00:18:42.000 portability to the industry standard. 00:18:43.000 --> 00:18:45.000 But then again there's the Apple point of view. 00:18:47.000 --> 00:18:53.000 The effect that I see from IBM is that there's less of a concern about the user 00:18:53.000 --> 00:18:57.000 in designing computers and more of a concern about 00:18:57.000 --> 00:18:58.001 the organization and the corporation. 00:19:00.000 --> 00:19:04.000 And therefore you end up with computers that are more difficult to use and it's 00:19:04.000 --> 00:19:07.001 more difficult to get people into computing to understand the benefits of it. 00:19:07.001 --> 00:19:11.001 So basically what you're saying, I guess John, is that if you work within the 00:19:11.001 --> 00:19:16.000 framework of IBM structure that there's innovation in order to really 00:19:16.000 --> 00:19:17.001 have, if you're going to go outside, you're going 00:19:17.001 --> 00:19:19.000 to have to be an Apple to be able to be competitive. 00:19:20.000 --> 00:19:24.000 Well, speaking of Apple and competitive, we have Apple talk now and Apple's 00:19:24.000 --> 00:19:27.000 movement to the business world and laser printer and so on. How serious do you 00:19:27.000 --> 00:19:30.001 think is the Apple move into the business market which is clearly IBM's now? 00:19:30.001 --> 00:19:34.000 Well, certainly it's very serious. I mean Apple's future depends to a large 00:19:34.000 --> 00:19:37.000 degree on whether they're capable of selling their computers to businesses. 00:19:39.000 --> 00:19:43.001 But as I said before, they focus so strictly on the individual that there are 00:19:43.001 --> 00:19:46.001 limited benefits to using Apple computers in an organization. 00:19:47.001 --> 00:19:52.000 Isn't this, to some extent, I guess isn't Apple really educationally oriented 00:19:52.000 --> 00:19:55.001 mainly and breaking into the business is a difficult thing or not? Is that true? 00:19:55.001 --> 00:19:58.000 Well, I like to think of Apple as if it's a huge vertically integrated 00:19:58.000 --> 00:20:02.001 advertising company. They have tremendous brand awareness among individual 00:20:02.001 --> 00:20:06.001 consumers but corporate America has decided on the industry standard. That's what 00:20:06.001 --> 00:20:08.000 you find in offices throughout the land. 00:20:09.000 --> 00:20:14.000 One of the Apple raps against IBM is still the IBM mainframe mentality and they 00:20:14.000 --> 00:20:17.000 still don't really understand what a PC is. Is that a fair comment? 00:20:18.001 --> 00:20:23.000 Well, IBM sold quite a few PCs. I'd say that's tough to defend. 00:20:23.000 --> 00:20:26.001 But if you take a look at that, isn't it really true that the way they sold PCs 00:20:26.001 --> 00:20:30.000 to begin with is they almost exactly duplicated on Apple with a different 00:20:30.000 --> 00:20:34.001 processor but it was memory mat video, small discets and things. That 00:20:34.001 --> 00:20:37.000 doesn't take a lot of innovation. 00:20:37.001 --> 00:20:41.001 Well, remember that IBM's PC operation was a start-up venture and for the first 00:20:41.001 --> 00:20:44.001 18 months of their life they really were an independent business unit and the 00:20:44.001 --> 00:20:46.001 results were breathtaking. It was startling. 00:20:47.000 --> 00:20:50.001 Since then, perhaps they've become more sluggish and more concerned about 00:20:50.001 --> 00:20:54.000 compatibility and there's been more warring between factions of the IBM 00:20:54.000 --> 00:20:56.000 corporation about who has responsibility 00:20:56.000 --> 00:20:57.001 for the sales organization and which markets. 00:20:58.000 --> 00:21:01.000 But the results of those first 18 months were astonishing. 00:21:02.000 --> 00:21:05.001 Gentlemen, before we finish up here, we've had this PCAT sitting here during the 00:21:05.001 --> 00:21:08.001 whole program and that's a story in itself and there's a lot of concern about 00:21:08.001 --> 00:21:12.001 problems with the AT and other people say it's a great machine. Stewart, 00:21:12.001 --> 00:21:14.000 what is the inside story on the AT? 00:21:14.000 --> 00:21:18.000 Well, at this point it is a great machine. I mean, it's extremely fast and very 00:21:18.000 --> 00:21:22.000 powerful and offers a lot of benefits both to corporations and to individuals. 00:21:22.001 --> 00:21:27.000 But they've had some problems delivering on certain models of the AT, 00:21:27.000 --> 00:21:30.000 particularly the one that contains a hard disk storage inside of it. 00:21:30.001 --> 00:21:34.001 And at this point it's very interesting because IBM is in a situation where 00:21:34.001 --> 00:21:38.000 they're having trouble with each of the computer products that they have on the 00:21:38.000 --> 00:21:43.001 market with the PC juniors since they've removed discounts from it and with the 00:21:43.001 --> 00:21:47.001 PC and XT because this one is so aggressively priced and so much more powerful. 00:21:47.001 --> 00:21:52.000 But it still is very much a market from the low end PCs. It wouldn't be 00:21:52.000 --> 00:21:54.001 considered something you put in your home necessarily when you're 00:21:54.001 --> 00:21:56.000 talking about a $6,000 price tag. 00:21:57.001 --> 00:21:58.000 Certainly not. 00:21:58.001 --> 00:22:01.000 I think the importance of the AT is it's put a stake in the ground for where the 00:22:01.000 --> 00:22:04.000 next generation of systems is and it's fundamentally an open system. So we'll see 00:22:04.000 --> 00:22:06.001 lots of innovation in and around this standard. 00:22:06.001 --> 00:22:09.000 Well, this is a good question. You think that IBM is going to close up the system 00:22:09.000 --> 00:22:13.001 to some extent? We see Top View now as being a software being brought internally 00:22:13.001 --> 00:22:16.001 into IBM. Are they going to close up the system the next generation? 00:22:16.001 --> 00:22:21.000 If IBM gets control of the application software, one, two, three, Wordstar, the 00:22:21.000 --> 00:22:24.000 important applications, then they could close up the system. But right 00:22:24.000 --> 00:22:26.000 now they don't control the whole solution. 00:22:27.000 --> 00:22:30.001 Gentlemen, we're out of time. Thank you very much. One of the interesting and 00:22:30.001 --> 00:22:34.000 obvious aspects about IBM is its secrecy. It's almost legendary corporate 00:22:34.000 --> 00:22:38.000 mentality. In fact, it's obvious here IBM declined to have an IBM representative 00:22:38.000 --> 00:22:40.000 on this program about IBM. 00:22:40.000 --> 00:22:44.001 Why the secrecy? Why almost the paranoia, as some people call it? Our commentator 00:22:44.001 --> 00:22:46.000 Paul Schindler has some thoughts on that. 00:22:47.001 --> 00:22:51.001 You know, it's like they say in court. Sometimes the truth isn't the whole truth. 00:22:51.001 --> 00:22:55.001 Now the truth is it looks like I'm wearing a three-piece suit. But the whole 00:22:55.001 --> 00:22:57.001 truth is that I've got tennis shorts on. 00:22:58.000 --> 00:23:01.000 You see, this reminds me of IBM and its public relations because they always tell 00:23:01.000 --> 00:23:05.001 the truth, but they seldom tell the whole truth. A lot of us who write about 00:23:05.001 --> 00:23:09.001 computers for a living ask ourselves, how? How does IBM get away with it? 00:23:09.001 --> 00:23:13.001 How can they be so secretive and unresponsive? They're the only company in the 00:23:13.001 --> 00:23:17.001 computer business that consistently refuses to provide meaningful guidance on 00:23:17.001 --> 00:23:19.001 product direction on or off the record. 00:23:20.000 --> 00:23:23.001 The only explanation I can think of is their size and power. It's like the old 00:23:23.001 --> 00:23:27.000 gag bumper sticker about the phone company. We don't care because we don't have 00:23:27.000 --> 00:23:32.000 to. IBM doesn't care whether users have a good idea of what's coming next or 00:23:32.000 --> 00:23:35.001 where IBM is going because it knows they're going to buy IBM products regardless. 00:23:35.001 --> 00:23:39.000 There's no law that says they have to be talkative and helpful like everyone 00:23:39.000 --> 00:23:44.001 else. No one else could do it because if some other company clammed up like IBM 00:23:44.001 --> 00:23:48.001 does, no one would ever write about it. We cover IBM because we 00:23:48.001 --> 00:23:50.000 have to, not because they make it easy. 00:23:50.001 --> 00:23:55.000 And until the day comes when IBM is no longer number one, they'll continue to be 00:23:55.000 --> 00:23:57.001 secretive. That's my opinion. I'm Paul Schindler. 00:24:08.001 --> 00:24:12.000 In the Random Access File this week, for the first time in the history of Apple 00:24:12.000 --> 00:24:14.001 computers, Apple will be shutting down four of 00:24:14.001 --> 00:24:16.000 its manufacturing plants for a week. 00:24:16.001 --> 00:24:20.001 Employees in California, Texas, Ireland and Singapore are being forced to go on 00:24:20.001 --> 00:24:24.001 paid vacation for a week as Apple attempts to bring its bloated inventory down. 00:24:25.000 --> 00:24:28.001 Analysts say the personal computer industry is at a standstill with most sales at 00:24:28.001 --> 00:24:31.000 the corporate level where Apple is still weak. 00:24:31.000 --> 00:24:35.000 Meanwhile, Apple announced this past week an upgrade for the 2E. The new 2Es will 00:24:35.000 --> 00:24:38.000 have a new microprocessor, the same one that's in the 2C. 00:24:38.001 --> 00:24:42.001 Apple is also adding three ROM chips to the 2E to improve graphics, speed up 00:24:42.001 --> 00:24:46.001 programming and provide a mouse interface. The price stays the same and current 00:24:46.001 --> 00:24:48.001 2E owners can get an upgrade for $70. 00:24:49.001 --> 00:24:53.000 The long-awaited Tsukuba Science Expo opened this week in Japan. The high-tech 00:24:53.000 --> 00:24:56.000 fair features the latest in computer and robot technology. 00:24:56.000 --> 00:25:00.000 Among the robots on display at the Tsukuba Expo are one which can draw lifelike 00:25:00.000 --> 00:25:04.000 sketches and another which can read music and then play the music on an organ. 00:25:04.001 --> 00:25:07.001 NEC and Fujitsu are showing off their new real-time language translation 00:25:07.001 --> 00:25:11.001 computers. American technology is also on display with an $8 million pavilion 00:25:11.001 --> 00:25:13.001 devoted to artificial intelligence. 00:25:14.001 --> 00:25:16.001 Meanwhile, back in Washington, the U. S. government is being 00:25:16.001 --> 00:25:18.001 accused of having too much intelligence. 00:25:19.000 --> 00:25:22.001 The General Services Administration has brought in a computer to monitor and 00:25:22.001 --> 00:25:25.000 analyze the phone calls made by government employees. 00:25:25.000 --> 00:25:28.001 The computer program looks for frequently called numbers and numbers called at 00:25:28.001 --> 00:25:32.001 odd hours and compares those to a list of usual business numbers to determine 00:25:32.001 --> 00:25:35.000 which employees are abusing the government phone system. 00:25:35.001 --> 00:25:38.001 Civil libertarians are saying this is the worst case of a government using 00:25:38.001 --> 00:25:41.000 computers to snoop on its citizens. 00:25:42.000 --> 00:25:44.000 Paul Schindler's been out snooping around the software 00:25:44.000 --> 00:25:46.000 world and here's his review for the week. 00:25:47.000 --> 00:25:51.000 I don't know about you, but I feel pretty silly having to keep one of these 00:25:51.000 --> 00:25:55.000 around in our electronic age. Why should I need a dictionary to help me spell? 00:25:55.001 --> 00:25:58.000 There are lots of spelling checkers on the market. In fact, we've reviewed one 00:25:58.000 --> 00:26:02.000 here on the Computer Chronicles before, but that was before I ran into PFS proof. 00:26:02.001 --> 00:26:06.000 Software Publishing Corporation sells this little gem, but I want to mention it 00:26:06.000 --> 00:26:08.000 was written by the people at Futuristics in San 00:26:08.000 --> 00:26:10.000 Rafael, California, who went to school with me. 00:26:10.000 --> 00:26:14.001 That's not why I like PFS proof. I like it because it's faster and easier to use 00:26:14.001 --> 00:26:17.001 and takes up less disk space than other spelling checkers. 00:26:18.000 --> 00:26:22.000 Now, the opening menu is simplicity itself. I've never opened the manual. 00:26:22.001 --> 00:26:24.000 Proofreading a document is that simple. 00:26:24.001 --> 00:26:28.000 It shows you the context and offers a guess when it has one about what you might 00:26:28.000 --> 00:26:30.001 have meant. It looks for double words, it looks for funny 00:26:30.001 --> 00:26:32.000 capitalization, and it looks fast. 00:26:32.001 --> 00:26:35.001 I mean really fast. It's the fastest spelling checker I've ever seen. 00:26:35.001 --> 00:26:39.000 This program even allows integrated importation of word lists quickly and 00:26:39.000 --> 00:26:43.001 smoothly. For $95, I think you'll like PFS proof from Software 00:26:43.001 --> 00:26:45.000 Publishing in Mountain View, California. 00:26:45.000 --> 00:26:47.000 For Random Access, I'm Paul Schindler. 00:26:48.000 --> 00:26:52.001 Are you ready for this? You can now buy computerized running shoes. Adidas is 00:26:52.001 --> 00:26:55.001 coming out with running shoes that have a computer built into the left shoe. 00:26:56.000 --> 00:26:59.001 The computer measures your average running speed, length of stride, and number of 00:26:59.001 --> 00:27:02.001 calories burned. The new high-tech running shoes are called micro 00:27:02.001 --> 00:27:04.001 -pacers. They'll sell for about $100. 00:27:04.001 --> 00:27:09.000 And if you just use shoes for walking, you too can play with a computer today. 00:27:09.001 --> 00:27:13.000 Florsheim Shoes is installing what they call convenience centers, automated shoe 00:27:13.000 --> 00:27:15.001 stores. The buyer sits down at a computer terminal 00:27:15.001 --> 00:27:17.000 hooked up to a laser disk player. 00:27:17.001 --> 00:27:20.000 The machine measures your feet, analyzes the inventory, and 00:27:20.000 --> 00:27:21.001 tells you what's available in your size. 00:27:22.000 --> 00:27:25.001 You can then look at all the styles via laser disk, and you can buy the shoes 00:27:25.001 --> 00:27:29.000 just by sliding your credit card into the automated kiosk. 00:27:29.000 --> 00:27:32.001 Florsheim already has four such robot stores in operation. 00:27:33.000 --> 00:27:35.001 If you're into puppies rather than hush puppies, you'll be 00:27:35.001 --> 00:27:37.000 interested in a new computer database. 00:27:37.001 --> 00:27:42.000 For pet owners, Alpo Pet Foods has set up a National Lost Pet Database. 00:27:42.001 --> 00:27:47.000 Each pet is given a computer-coded ID tag. If a dog is lost or found, entering 00:27:47.000 --> 00:27:49.001 the ID into the database will immediately list the 00:27:49.001 --> 00:27:51.000 owner or the nearest pet shelters. 00:27:51.001 --> 00:27:54.001 The pet locator's network is headquartered in Valley Forge, Pennsylvania. 00:27:54.001 --> 00:27:58.001 Finally, in this era of computers, whatever happened to the good old slide rule? 00:27:58.001 --> 00:28:02.001 Well, the answer is not much. The company of Kefel and Esser, which used to be a 00:28:02.001 --> 00:28:06.000 major manufacturer of slide rules, says it has sold less than a dozen 00:28:06.000 --> 00:28:07.001 slide rules in the last three years. 00:28:08.000 --> 00:28:11.001 In a recent survey of college students, 75% of the students didn't 00:28:11.001 --> 00:28:13.001 know what a slide rule was. 00:28:13.001 --> 00:28:16.000 That's it for this week's Computer Chronicles. We'll see you next time. 00:28:24.001 --> 00:28:27.001 This is a video that gives readers an understanding of the technology and 00:28:27.001 --> 00:28:33.000 applications of microcomputers and software in office, home and classroom. 00:28:54.001 --> 00:29:12.000 Thanks for watching!